Millie's Draperies Uses the Allowance Method of Recording Bad Debts

question 68

Multiple Choice

Millie's Draperies uses the allowance method of recording bad debts. On June 13, the $200 account balance of Jane Murphy was written off as uncollectible. However, on August 5, Murphy paid $80 of the amount previously written off. The entry to reinstate Jane Murphy's account would include:

• A)debit Cash $80; credit Uncollectible Accounts Expense $80
• B)debit Accounts Receivable $200; credit Allowance for Doubtful Accounts $200
• C)debit Allowance for Doubtful Accounts $80; credit Cash $80
• D)debit Accounts Receivable $80; credit Allowance for Doubtful Accounts $80

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